As at April 19, 2013, except updated British Columbia (June 2015); Ontario (June 2015); Saskatchewan (January 2014) & Prince Edward Island (February 2014)

CANADIAN VEHICLE VICARIOUS LIABILITY REPORT prepared for the Canadian Finance & Leasing Association by Miller Thomson LLP and Stewart McKelvey LLP

Ryan W. Morasiewicz – British Columbia Nancy Rubin - Nova Scotia Joseph Yurkovich – Alberta Janet Clark - Prince Edward Island Francis Poulin - Saskatchewan Steven Scruton - Newfoundland and Labrador Reginald Watson, Q.C. – Saskatchewan Sarah Dever Letson - New Brunswick Jennifer Babe – Ontario Bruce McCartney – Ontario

Pierre Paquet – Québec

TABLE OF CONTENTS Page Introduction …………………………………..………… 1 Alberta ……………………………………..…………… 4 British Columbia …………………….………………… 10 Manitoba ……………………………………….…….... 13 New Brunswick ………………………………..…….... 14 Newfoundland and Labrador …………………..……. 20 Nova Scotia …………………………….………...…… 21 Ontario ………………………………………..…..…… 28 Prince Edward Island …………………….….….…… 32 Québec …………………………………………...…… 36 Saskatchewan ………………………………………... 37

15 Toronto Street, Suite 301, Toronto, Ontario, Canada M5C 2E3 Tel: 416.860-1133 toll free: 1.877.213-7373 fax: (416.860.1140 e-mail: [email protected] website: www.cfla-acfl.ca

15 rue Toronto, Bureau 301, Toronto (Ontario) Canada M5C 2E3 Téléphone: 416.860.1133 sans frais: 1.877.213.7373 télécopieur: 416.860.1140 courriel: [email protected] site web: www.cfla-acfl.ca

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

VEHICLE OWNER VICARIOUS LIABILITY (CANADA)

This report is a summary of the key legislation in the Canadian Provinces which imposes vicarious liability on lessors, renters and conditional sale vendors as owners of motor vehicles for damages caused by lessee, rental customer and conditional sale purchaser drivers. Exceptions for certain classes of vehicles are noted. The chart is not exhaustive and does not cover other or all situations in which an owner of a motor vehicle may be held liable.

Generally speaking, the following parties are exposed to claims for vicarious liability for personal injury claims as owners of motor vehicles, but please read the chart for more detail:

(a) Lessors/renters whose leases have options to purchase: BC*, Alberta*, Saskatchewan*, Manitoba*, Ontario*, PEI* (b) Lessors/renters whose leases have no options to purchase: BC*, Alberta*, Saskatchewan*, Manitoba*, Ontario*, New Brunswick, Nova Scotia, PEI and Newfoundland and Labrador (c) conditional sale vendors: Alberta, Ontario, PEI*

*Sask: has a right for residents to purchase tort claim insurance and with case law, rights to certain benefits above no fault insurance

*Ontario: has capped lessor liability for personal injuries for accidents that occurred on or after March 1, 2006, but there is liability for property damages

*B.C. has capped lessor liability for personal injuries for accidents that occurred on or after November 8, 2007; based on case law this capped liability is $1 million from lessee + $1 million from lessor

*AB: has capped lessor liability for personal injuries for accidents that occurred on or after March 1, 2011

*Quebec: has no liability for personal injuries, but there is liability for property damage for vehicles leased for a term of less than one year

*Manitoba: has no liability for personal injuries, but property damage liability continues

* NS: has no liability for conditional sellers and lessors with an option to purchase

*PEI: has no liability for conditional sellers and lessors with an option to purchase, for accidents occurring on or after February 1, 2014

There is no legislated cap on damages for vicarious liability in any of the provinces, except in Ontario, BC, Alberta and Nova Scotia and only in the circumstances as noted below. The vicarious liability cap does not appear to be limited to personal injury claims in Nova Scotia but also caps third party property and environmental damages.

Page 1 of 47

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

These do not protect against property damages in Ontario or environmental claims. They do not protect against product liability claims or negligence for provision of a defective or badly maintained or equipped motor vehicle.

Provincial legislation imposing a vicarious liability “cap” of $1 million on vehicle lessors and rental companies was adopted in Ontario (effective date March 1, 2006), followed by British Columbia (effective date November 8, 2007), then Alberta (effective date March 1, 2011), and finally Nova Scotia (effective date April 1, 2013). However, while a $1 million cap is common to all four jurisdictions, the provincial legislation in these four provinces varies as follows:

Ontario - The 2006 amendments to the Insurance Act and Highway Traffic Act (Ontario) caps the vicarious liability of lessors and rental companies at $1million for loss or damage from bodily injury or death arising directly or indirectly from the use or operation of a motor vehicle that is leased or rented. If the customer has $1 million of valid insurance, there is nothing due from the lessor. If the customer has less than $1 million of valid insurance, the lessor or rental company is liable for the difference up to $1million and no more for bodily injury.

The Ontario legislation does not “cap” vicarious liability for lessors or rental companies for

(i) property damage; or

(ii) for accidents involving taxicabs, limousines or “livery vehicles” [as defined in Regulation passed pursuant to the Insurance Act]; or

(iii) for accidents caused their employees. The liability for the driver, lessee or rental customer, or the operator of a vehicle or the employer of the driver of a vehicle remains unlimited.

7.(1) For the purposes of clause 267.12 (4) (c) of the Act, a livery vehicle is a motor vehicle, (a) that is designed for transporting not more than nine passengers; and (b) that is not a taxicab or limousine. (2) Subsection 267.12 (1) of the Act does not apply in respect of a livery vehicle during any period in which it is used to transport passengers for a fee.

British Columbia –2007 legislative amendments in British Columbia cap the vicarious liability of lessors and rental companies for their vehicles in British Columbia, other than for vehicles used as taxis, buses, and limousines.

The wording of the British Columbia amendments have been interpreted such that a payment of $1 million under the lessee’s insurance has the effect of reducing the statutory liability of the lessor to the full extent of the payment made. The British Columbia Court of Appeal also found that a driver of a leased vehicle may seek additional indemnification pursuant to the lessor’s excess policy unless the lessor’s insurance includes a specific exclusion as required by British Columbia law.

Alberta - The statutory and regulatory provisions relevant to the Alberta cap on vicarious liability that came into effect March 1, 2011 are contained in the Alberta Traffic Safety Act and related Commercial Vehicle Certificate and Insurance Regulation and the Alberta Insurance Act and its related Miscellaneous Provisions Regulation.

The Traffic Safety Act provides a blanket $1 million cap on claims for “loss or damage sustained by a person”. Therefore, while this proviso does not specifically continue on to reference “property” (as B.C.’s corresponding legislation does) the wording appears to cover losses other than

Page 2 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

personal injuries sustained by individuals and is significantly broader than the corresponding provision (section 267.12) of the Ontario Insurance Act.

The only exception is that by Section 31.1 of the Commercial Vehicle Certificate and Insurance Regulation, all commercial vehicles used or intended to be used to transport passengers, including taxis, buses, limousines, airport shuttles, funeral service and other passenger vehicles that are driven or owned by persons who have broadly defined financial interests or other business or blood relationships with lenders, lessors, renters or sellers of those vehicles, are excluded from the limitation on liability provided by the cap regime.

Nova Scotia – The Nova Scotia Insurance Act and the Non-Owned Automobile Insurance Liability Regulations exempt conditional sellers, and cap the vicarious liability of rental companies and lessors whose leases have no option to purchase. The provisions came into effect April 1, 2013.

A lessor or renter’s maximum liability under the Insurance Act is net of all other amounts received in respect of the same incident and a lessor or renter will not be required to make any payments to a claimant beyond a top-up to the prescribed maximum liability of $1 million (or greater if required by law or prescribed by regulation).

The Non-Owned Automobile Insurance Liability Regulations establish the priority of payment among automobile insurance policies in reference to “motor vehicle liability policies” which are defined under the Insurance Act to include property damage. Although the vicarious liability provisions have not yet received judicial consideration, the wording suggests that the vicarious liability cap is not restricted to personal injury claims, but also extends to third part property damage.

The only exception is that by Section 8 of the Non-Owned Automobile Insurance Liability Regulations, the cap does not apply to vehicles engaged in the public carrier of passengers, or passengers and freight, for gain (such as taxis and busses).

Prince Edward Island – Amendments to the PEI Highway Traffic Act removed deemed vicarious liability for a conditional seller, lender or seller who was not in possession of the vehicle at the time loss or damage was sustained. The provisions came into effect February 1, 2014.

Reminder: vehicles move and the accident may occur in a jurisdiction other than where the customer resides or is located, changing the owner’s exposure to liability.

In this chart, “lessor” includes both longer term leases as well as short term renters of vehicles.

Page 3 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

ALBERTA Traffic Safety Act, R.S.A. TSA The definition of “owner” is inclusive, The Courts will look at a 2000, c. T-6, Sections and would likely include both a number of factors in 1(1)(ee) and 187 [“TSA”] 1(1)(ee) “owner” means the person conditional sale vendor and a lessor determining ownership, and who owns a vehicle and includes any such that both would be vicariously and there can be more Insurance Act, R.S.A. person renting a vehicle or having the liable for the negligence of the than one owner: 2000, c. I-3, Section 650 exclusive use of a vehicle under a driver. Ford Credit Canada Ltd. [“IA”] (see below) lease that has a term of more than 30 v. Solis (2003) 226 days or otherwise having the exclusive Note the cap does NOT apply to D.L.R. (4th) 744 (Alta. use of a vehicle for a period of more commercial vehicles used or C.A.), aff’g Mahan v. than 30 days. intended to be used to transport Hindes [2002] 2 W.W.R. passengers. 360 (Alta. Q.B.); (The following underlined affirmed by Alberta C.A. amendments to the TSA and IA were (2003) 226 D.L.R. (4th) effective March 1, 2011. 744, and Alas v. Solis th 187(0.1) In this section, (2001) 203 D.L.R. (4 ) 409 (Alta. Q.B.). (a) “lender” means a person who holds a security interest in a motor vehicle Consequently, both a through a written security agreement, lessee and a lessor who under that agreement has lent could be "owners" under money to a person in respect of the the Act. motor vehicle and who is not in possession of the motor vehicle but The amendments create retains title to the motor vehicle, or a a cap on liability (which person to whom the lender has is the greatest of $1 assigned the agreement; million, the provincially required amount of third (b) “lessor” means a person who by party liability insurance, agreement, in the ordinary course of and the amount the person’s business, leases or grants established by exclusive use of a motor vehicle to regulation) which is another person for a term of more than reduced to the extent of 30 days or otherwise grants exclusive any recovery under the use of a motor vehicle to another third party liability person for a period of more than 30 provisions of a policy days, and who is not in possession of “issued to a person the motor vehicle, or a person to whom other than a lender, the lessor has assigned the agreement; lessor, renter or seller” (c) “motor vehicle liability policy” means relating to the same a motor vehicle liability policy under the motor vehicle accident. Insurance Act; This cap will apply to “lenders” and “sellers”;

Page 4 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

ALBERTA (d) “security agreement” means a essentially creditors who (CONTINUED) security agreement under the Personal may be caught by the Property Security Act; definition of “owner” in the TSA by virtue of (e) “security interest” means a security having taken or retained interest under the Personal Property title to a vehicle as Security Act; lender or conditional sales vendor. In its final (f) “seller” means a person who holds form, the cap also a security interest in a motor vehicle applies both to “lessors” through a written security agreement and “renters”. So while and sells the motor vehicle to another the term “lessor” retains person under a contract in writing but the requirement for the retains title to the motor vehicle until term of a lease to be the purchaser has carried out the terms more than 30 days a of the contract and who is not in person who, in the possession of the motor vehicle, or a ordinary course of their person to whom the seller has business, rents a assigned the security agreement or the vehicle for a period of contract. not more than 30 days and is not in possession (1) In an action for the recovery of loss of the vehicle will be or damage sustained by a person by entitled to rely on the reason of a motor vehicle on a cap. highway, a person who, at the time that the loss or damage occurred, The Alberta cap is set out in amendments to (a) was driving the motor vehicle, and the TSA rather than the IA. Alberta has provided (b) was living with and as a member of no amendments to the the family of the owner of the motor IA for the purpose of vehicle, ordering the priority of response of: policies for is deemed, with respect to that loss or which the owner and damage, related persons may be the named insured; (c) to be the agent or employee of the policies with the owner owner of the motor vehicle, and lessor as jointly named insured; and the (d) to be employed as the agent or lessor’s commercial employee of the owner of the motor umbrella policy. vehicle, and Regulations under section 650 of the

Page 5 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

ALBERTA (e) to be driving the motor vehicle in the Insurance Act are set (CONTINUED) course of that person’s employment. out in Section 7.1 of the Miscellaneous Provisions Regulation. (2) In an action for the recovery of loss These provisions which or damage sustained by a person by also come into force on reason of a motor vehicle on a March 1, 2011, are highway, a person who, at the time that designed to ensure that the loss or damage occurred, the liability cap is not frustrated or (a) was driving the motor vehicle, and circumvented by a requirement for an (b) was in possession of the motor insurance policy issued vehicle with the consent, expressed or to an owner of a motor implied, of the owner of the motor vehicle who acts as a vehicle, lessor or renter to respond in priority to the is deemed, with respect to that loss or insurance issued to the damage, lessee, rentee or driver of the motor vehicle. (c) to be the agent or employee of the owner of the motor vehicle,

(d) to be employed as the agent or

employee of the owner of the motor

vehicle, and

(e) to be driving the motor vehicle in the course of that person’s employment.

(2.1) Notwithstanding any other provision in this Division except subsections (5) and (6), in an action for the recovery of loss or damage sustained by a person by reason of a motor vehicle on a highway, the maximum amount for which a lender, lessor or seller of the motor vehicle is liable in respect of the same incident in its capacity as a lender, lessor or seller of the motor vehicle is the amount determined under subsection (4) less any amounts that

Page 6 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

ALBERTA (a) are recovered for loss or damage (CONTINUED) under the third party liability provisions of contracts evidenced by a motor vehicle liability policy issued to a person other than a lender, lessor or seller,

(b) are in respect of the use or operation of the motor vehicle, and

(c) are in respect of the same incident.

(3) Notwithstanding subsections (1) to

(2.1), nothing in this section relieves

any person who is deemed to be the

agent or employee of the owner and to

be driving the motor vehicle in the course of that person’s employment from liability for the loss or damage.

(4) The maximum amount for which a lender, lessor or seller of a motor vehicle is liable for the purposes of subsection (2.1) is the greatest of

(a) $1 000 000,

(b) the amount of third party liability insurance required by law to be carried in respect of the motor vehicle, and

(c) the amount established, or determined in the manner prescribed, by regulation.

(5) Subsection (2.1) does not apply

(a) in respect of amounts payable by a lender, lessor or seller other than by reason of vicarious liability imposed by

Page 7 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

ALBERTA this section, or (CONTINUED) (b) to prescribed lenders, lessors or sellers or motor vehicles, or prescribed classes of lenders, lessors or sellers or motor vehicles.

(6) This section applies only in relation to loss or damage sustained on or after the date this section comes into force.

(7) The Minister may make regulations

(a) establishing amounts payable, or prescribing the manner of determining amounts payable, for the purposes of subsection (4)(c);

(b) prescribing lenders, lessors and sellers and motor vehicles or classes of lenders, lessors and sellers and motor vehicles for the purposes of subsection (5)(b).

(8) The Minister may make different

regulations under subsection (7)(b) in

relation to lenders, lessors and sellers

and motor vehicles, or classes of

lenders, lessors and sellers and motor

vehicles, for different circumstances.

Insurance Act, R.S.A. IA 2000, c. I-3, Section 650 [“IA”] 650(4) Despite subsection (1), the Lieutenant Governor in Council may make regulations

(a) respecting the priority of payment of insurance held by a lessor as defined in section 187 of the Traffic Safety Act or a rental car company in respect of liability arising from or occurring in connection with the ownership, use or operation of an automobile owned by

Page 8 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

the lessor or rental car company;

(b) defining terms for the purposes of this section;

(c) where regulations are made under clause (a) or (b), modifying any provision of this Act to the extent that the Lieutenant Governor in Council considers necessary in order to carry out the purpose and intent of this section.

Page 9 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

BRITISH COLUMBIA Motor Vehicle Act, MVA Section 86 of the Motor Vehicle Act These sections are in R.S.B.C. 1996, c. 318, is to be read conjunction with force as of, and apply

ss.86(1.2)-(4) 86 section 82.1 of the Insurance to, accidents occurring (1.2) In the case of a motor vehicle that (Vehicle) Act, and section 181 of the after November 8, 2007. and is in the possession of its lessee, in an Insurance (Vehicle) Regulation. Accidents occurring action to recover for loss or damage to prior to this date still Insurance (Vehicle) Act, persons or property arising out of the Note the liability cap does NOT engage vicarious liability R.S.B.C. 1996, c. 231, use or operation of the motor vehicle apply to vehicles used as taxis, under the predecessor s.82.1 on a highway, a person driving or buses and limousines. statutory provisions. (see below) operating the motor vehicle who acquired possession of the motor On September 5, 2013, Mr. Justice It is unclear from the vehicle with the consent, express or Bowden rendered judgment in face of the legislation implied, of its lessor is deemed to be Stroszyn v. Mitsui Sumitomo whether the $1 million the agent or servant of, and employed Insurance Company Limited , 2013 lessor vicarious liability as such by, that lessor and to be BCSC 1639. This decision cap is engaged only driving or operating the motor vehicle in substantially changed the when there is the course of his or her employment application of the British Columbia insufficient primary with that lessor. lessor cap of $1,000,000. insurance or whether it can be engaged (1.3) The liability under subsection (1.2) Justice Bowden departed from our regardless of the of a lessor is subject to the applicable prior understanding of the effect of existence and amount of limit established under section 82.1 of the latter lessor cap. At paragraph primary insurance. the Insurance (Vehicle) Act. 35 he found: … Lessors should consider "[35] In my view, the payment of notifying their excess (3) In this section: $1,000,000 on behalf of the lessee insurers for claims in does not reduce the liability of which the quantum may "lessee" means a person who leases Honda Canada to zero. It is simply a exceed $1 million or rents a motor vehicle from a lessor payment by one joint tortfeasor assuming the driver of for any period of time; towards the total liability of the jointly their vehicle may be "lessor" means the following: liable parties. By virtue of s. 86(1.2) entitled to additional of the MVA, both the driver, Mr. coverage if the excess (a) subject to paragraph (b), a Chen, and Honda Canada are jointly policy does not include person who, under an agreement liable for the damages of the required exclusion in in writing and in the ordinary $1,600,000. Pursuant to s. 82.1, compliance with s. 61(2) course of the person’s business, Honda Canada’s portion of that of the Insurance leases or rents a motor vehicle to liability cannot exceed $1,000,000. (Vehicle) Act another person for any period of Of the total liability, $1,000,000 has time; been discharged by ICBC on behalf Lessors’ contingent (b) if the lessor referred to in of the lessee, but Honda Canada claims budget reserves paragraph (a) has assigned the remains liable as a joint tortfeasor, should also be updated agreement, the assignee; for $600,000." to account for any amounts that may be

Page 10 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

BRITISH COLUMBIA "owner" On Appeal, the court found that the self-insured. (CONTINUED) chambers judge erred. The $1 (a) includes a purchaser of a million settlement payment was a motor vehicle who is in payment made on behalf of both the possession of the motor vehicle lessee and driver. ICBC insured all under a contract of conditional parties under the primary policy and sale by which title to the motor its payment to the injured party was vehicle remains in the seller, or made on behalf of both the lessee the seller’s assignee, until the and the driver. As such, the purchaser takes title on full payment had the effect of reducing compliance with the contract, the statutory liability of the lessor to (b) if a purchaser of a motor the full extent of the payment made. vehicle is in possession of the motor vehicle, does not include The British Columbia of Appeal the seller of that motor vehicle further held that the driver is an under a contract of conditional insured under the excess policy, sale described in paragraph (a) or subject to the same terms and the assignee of that seller, and conditions in the underlying policy, as a result of the insurer’s failure to (c) does not include a lessee of a expressly exclude drivers from motor vehicle who is in coverage in accordance with the possession of the motor vehicle terms of s. 61(2) of the Insurance under an agreement in writing with (Vehicle) Act. the owner, whether or not the lessee may become its owner in compliance with the agreement. (4) This section, as amended by section 43 of the Miscellaneous Statutes Amendment Act (No. 2), 2007, applies only in relation to loss or damage sustained on or after the date that section comes into force.

Insurance (Vehicle) Act, I(V)A R.S.B.C. 1996, c. 231, 82.1 (1) In an action to recover for loss s.82.1 or damage to persons or property arising out of the use or operation of a leased motor vehicle on a highway in British Columbia, the maximum amount for which the lessor of the motor vehicle is liable, in that lessor’s capacity as lessor of the motor vehicle, in respect of any one incident is the

Page 11 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

BRITISH COLUMBIA amount determined under subsection (CONTINUED) (2). (2) The maximum amount for the purposes of subsection (1) is the greatest of the following amounts: (a) $1,000,000; (b) the amount established, or determined in the manner prescribed, by regulation; (c) the amount of third party liability insurance coverage required by law to be carried in respect of the motor vehicle. (3) Subsection (1) does not apply (a) in respect of amounts payable by a lessor other than by reason of vicarious liability imposed under section 86 of the Motor Vehicle Act, or (b) to prescribed lessors or motor vehicles, or prescribed classes of lessors or motor vehicles. (4) This section applies only in relation to loss or damage sustained on or after the date this section comes into force.

Page 12 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

MANITOBA The Highway Traffic Act, HTA: “Owner” means owner as defined The Act does not specifically provide Manitoba's no-fault S.M. 1985-86, c. 3, in The Drivers and Vehicles Act that an owner will be held vicariously system eliminates C.C.S.M.C. H60 (“HTA”) liable for the negligence of the claims for losses due to DVA: “Owner” includes a person who driver. bodily injury or death The Drivers and Vehicles has exclusive use of a vehicle under a occurring after March 1, Act, C.C.S.M.C. D 104 lease or other agreement for a period The definition of "owner" is inclusive 1994 in Manitoba. (“DVA”) of more than thirty (30) days. and would likely include both a lessor and a vendor under a However, a tort action HTA 153(1) Where loss or damage is conditional sale contract. can still be brought for sustained by any person by reason of a property damage or with motor vehicle upon a highway the onus However, The Manitoba Public respect to injuries which of proof that the loss or damage did not Insurance Compensation Act has occur outside of arise entirely or solely through the removed all tort rights in respect of Manitoba. negligence or improper conduct of the recovery for losses due to bodily owner or driver is upon the owner or injury or death to a Manitoba driver. resident as a result of a motor vehicle accident occurring after (2) Subsection (1) does not apply in March 1, 1994 in Manitoba. case of a collision between motor vehicles on the highway or to an action brought by a passenger in a motor vehicle other than a public service vehicle in respect of any injuries sustained by him while a passenger.

Page 13 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

NEW BRUNSWICK Motor Vehicle Act, Motor Vehicle Act: Neither a vendor under a conditional Caselaw indicates that a R.S.N.B. 1973, c. M-17. sales contract nor a lessor under a rental company is likely "Owner" means the legal owner of a lease with an option to purchase will to be found liable as and vehicle unless the vehicle is the subject be held liable for the negligence of owner: see Landry v. of a contract under the terms of which the driver as long as the Enterprise Rent-a-Car Insurance Act, R.S.N.B. another person has possession and buyer/lessee has possession of the Canada Ltd., 2012 1973, c. I-18. may acquire legal title thereto, in which vehicle. The definition of “owner” in NBQB 148 (Q.B.) [no (see below) event while that person has possession the Act provides the buyer/lessee in prima facie defence so against the legal owner, "owner" means possession would be considered the as to set aside a noting that other person. "owner" in these circumstances. in default].

“Registered Owner” means a person A lessor under a lease with no Lessors under a lease in whose name a vehicle is registered, option to purchase may be held without an option to as in this Act provided. liable as an "owner". There may be purchase may also be an exception for this if the lessor can found liable. The Court 267(1) The owner of a motor vehicle, show that it has no other indications will look at the or farm tractor is liable as well as the of ownership (i.e., the lessee circumstances of the driver thereof to an action for tort as a actually has exclusive use and case to determine result of negligence in the operation of control of the vehicle). whether the registered the motor vehicle or farm tractor unless owner of the vehicle is the motor vehicle or farm tractor was at A rental company is likely to be the “owner” for the the time of the negligent operation found liable as “owner”. purposes of assigning thereof in the possession of some liability under s. 267(1): person other than the owner without Note: For all leases of thirty days or Theriault v. Aubin and the owner's consent. more, both the lessor and the lessee Ouellette (1991), 121 must be listed as registered owners N.B.R. (2d) 235 (C.A.) 27(2)The registration certificate shall be pursuant to s. 27.1. delivered to the owner and shall A registered owner, contain upon the face thereof the date When the lessee is a registered (lessee or lessor) will issued, the name and address of the owner pursuant to s. 27.1, the not be excused from owner, the registration number lessee, not the lessor, then attracts liability if there are other assigned to the vehicle and such liability for certain offences under the indications of ownership description of the vehicle as may be Act: overtaking a stopped school (see Whelton v. Mercier, determined by the Registrar and upon bus (s. 188), violation of parking 2004 NBCA 83). the reverse side a form for rules (ss. 192-195), abandonment of Whelton v. Mercier endorsement of notice to the Registrar vehicles (s. 196), and violation of involved an agreement upon transfer of the vehicle. any local by-laws. for the transport of goods by truck. Lessee 27.1 Notwithstanding subsection 27(2), was an extraprovincial the registration certificate for a vehicle trucking company that being leased for a period of thirty days leased trucks and or more shall contain, in the place of drivers from lessor. the name and address of the owner, Both were listed as

Page 14 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

NEW BRUNSWICK the name of the owner together with registered owners (CONTINUED) the name and address of the lessee pursuant to extra- under the lease. provincial trucking license requirements. 188(1) The driver of a motor vehicle Lessor admitted it was meeting or overtaking a stopped school the true “owner” of the bus upon a highway when flashing red tractor trailer, but the lights are displayed on such school bus Court refused to grant shall bring such motor vehicle to a stop summary judgment at not less than five metres from such dismissing the claim school bus and shall not pass such against the lessee school bus until it is again in motion or because the lessee had the flashing red lights cease to be some other indicia of displayed. ownership, e.g.. 188(1.2)The owner of a motor vehicle exclusive use, insurance shall be guilty of a violation of policy. subsection (1) committed by any person operating the motor vehicle Generally speaking, a unless the owner establishes that Plaintiff in New another person Brunswick will commence an action (a)was operating the motor vehicle and against both a lessor had possession of it without the and lessee. owner’s consent, express or implied, at the time of the alleged violation, Damages Cap and Priority of Coverage: (b)has been charged with and New Brunswick has a convicted of the violation, or cap on general (c)admits to being the driver of the damages in our vehicle at the time of the alleged Insurance Act for minor violation. personal injuries sustained in a motor 188(1.3)Notwithstanding vehicle accident. It has subsection (1.2), if the registration no cap on vicarious certificate for a motor vehicle liability of respecting which a violation of renters/lessors. subsection (1) is committed shows the With respect to name and address of a lessee of the insurance coverage, s. vehicle as provided for in section 27.1, 265(1) of the Insurance the lessee shall be guilty of the Act provides that an violation unless the lessee establishes owner’s policy is first that another person loss insurance. (a)was driving the motor vehicle and

Page 15 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

NEW BRUNSWICK had possession of it without the The terms “owns” and (CONTINUED) lessee’s consent, express or implied, at “owner” are not defined the time of the alleged violation, in the Insurance Act. Courts have taken a (b)has been charged with and broad approach to the convicted of the violation, or definition of “owner”, (c)admits to being the driver of the except in the context of vehicle at the time of the alleged an exclusion in a policy. violation. See Burke Estate v. Royal & 188(1.4)A lessee charged with a Sun Alliance Insurance violation by virtue of subsection (1.3) Co. of Canada, 2011 may be charged as the principal NBCA 98. offender, but the information shall show that the charge is laid by virtue of Owner’s policies held by subsection (1.3). rental companies and/or 188(1.5) Notwithstanding section 362, lessors under a lease proof that any person is or was, on a without option to date stated in the proof, shown on a purchase will likely be registration certificate as provided for in considered first loss section 27.1 as the lessee of a motor insurance under section vehicle respecting which a violation is 265(1), pursuant to the alleged to have been committed on the following Ontario same date under subsection (1) shall decisions considering a be prima facie evidence that the person similar provision: was operating the motor vehicle at the Guardian Insurance Co. time of the alleged violation. of Canada v. York Fire & Casualty Insurance 270(1)The owner of a motor vehicle or Co., [1989] O.J. No. farm tractor shall be guilty of any 2233 (H.C.), varied with violation of this Act or of the respect to costs only at regulations, or of any local by-law [1992] O.J. No. 3714 committed by any person operating or (C.A.); Avis Rent A Car in charge of that vehicle, and involving System Inc. v. Certas Direct Insurance Co. (a)the equipment, mass, size or loading [2005] O.J. No. 1951 of the vehicle unless he establishes (C.A); and Morrison v. that the offence was committed without Ashley, 2012 ONSC his knowledge and consent and by a 745. person over whom he had no authority

or control;

(b)the operation of the vehicle, including the prohibited use of any

Page 16 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

NEW BRUNSWICK equipment thereon, unless he (CONTINUED) established that the vehicle was being operated by a person who

(i)had possession of the vehicle without

the owner’s consent, express or

implied,

(ii)is charged with and convicted of such violation, or

(iii)admits that he was the driver of the vehicle at the time of the alleged offence, and claims no privilege in respect to such admission. 270.1(1)Notwithstanding section 270, if the name and address of the lessee of a motor vehicle are shown on the registration certificate for the motor vehicle in accordance with section 27.1, the lessee shall be guilty of any violation of section 192, 193, 193.1, 194, 195 or 196 or of any violation of a local by-law established under paragraph 113(1)(a) committed in respect to that motor vehicle unless the lessee establishes that at the time of the violation the motor vehicle was being operated by some other person without the lessee’s consent, express or implied.

270.1(2)A lessee charged with a violation by virtue of subsection (1) may be charged as the principal offender, but the information shall show that the charge is laid by virtue of section 270.1.

270.1(3)Notwithstanding section 362,

proof that any person is or was, on a

date stated in the proof, shown on a

registration certificate in accordance

with section 27.1 as the lessee of a

motor vehicle in respect to which an

offence is alleged to have been

Page 17 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

NEW BRUNSWICK committed on such date under (CONTINUED) section 192, 193, 193.1, 194, 195 or 196 or under a local by-law established under paragraph 113(1)(a) shall be prima facie evidence that such person was operating the motor vehicle at the time of the alleged offence.

Proof that any person is or was on 362 a date therein stated the registered

owner of a motor vehicle in respect to

which any offence is alleged to have

been committed on such date under

this Act, or the regulations, or any by-

law or regulation of local authority

passed under the authority thereof shall

be prima facie evidence that such

person

(a)was operating the motor vehicle, and

(b)was the owner of the motor vehicle at the time of the alleged offence.

Insurance Act, R.S.N.B. Insurance Act: 1973, c. I-18 “owner’s policy” means a motor

vehicle liability policy insuring a person

in respect of the ownership, use or

operation of an automobile owned by

him and within the description or

definition thereof in the policy and, if

the contract so provides, in respect of

the use or operation of any other

automobile;

265(1)Subject to section 247, insurance under a contract evidenced by a valid owner’s policy of the kind mentioned in the definition “owner’s policy” in section 1 is, in respect of liability arising from or occurring in connection with the ownership, use or operation of an automobile owned by the insured named in the contract and

Page 18 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

NEW BRUNSWICK within the description or definition (CONTINUED) thereof in the policy, a first loss insurance, and insurance attaching under any other valid motor vehicle liability policy is excess insurance only.

Page 19 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

NEWFOUNDLAND AND Highway Traffic Act, 2 (vv) "Owner" means A 2002 case from the Newfoundland In Kerri v Decker, 2002 LABRADOR RSNL 1990, c H-3, (i) the person who holds the legal Court of Appeal has confirmed that NFCA 11, the s. 200 title to a vehicle, the following persons are NOT Newfoundland Court of (ii) in the case of a vehicle that is “owners” for the purposes of Appeal ruled that, while registered, the person in attracting vicarious liability,for the there is a presumption whose name it is registered, driver’s negligence under s. 200 of that a registered owner (iii) in the case of a vehicle that is the Highway Traffic Act (NL): of a vehicle is the owner the subject of a mortgage, the and vicariously liable for mortgagor if the mortgagor is a a vendor under a the negligence of the entitled to possession of the conditional sale contract, driver, that presumption vehicle, where the buyer is entitlted will be displaced in (iv) in the case of a vehicle that is to possession of the favour of the following the subject of a hire-purchase vehicle; AND persons (assuming they agreement, the person in b. a lessor under a lease with are different than the possession of the vehicle an option to purchase (i.e. registered owner), who under the agreement, or a hire-purchase will be treated as the (v) in the case of a vehicle that is agreement), where the sole owner for the the subject of a conditional “buyer” is entitlted to purposes of vicarious sale contract, the buyer under possession of the vehicle liability under s. 200 of the conditional sale contract if under the agreement.; the Highway Traffic Act the buyer is entitled to (NL): possession of the vehicle. However, a lessor under a lease with no option to purchase would (a) a mortgagor of a 200 (1) Without effect upon the liability likely be held liable as an "owner" vehicle, where he or she of the driver of a vehicle, the owner of a and would be vicariously liable for is entitled to possession vehicle is liable for loss or damage the negligence of the driver. of the vehicle; sustained by a person because of (b) the person in negligence in the operation of the possession of a vehicle vehicle unless the vehicle was without under a hire-purchase the owner's consent in the possession agreement; and of some person other than the owner. (c) the buyer of a (2) A person driving a vehicle who is vehicle under a living with and as a member of the conditional sale family of the owner of the vehicle shall contract, if he or she is be considered to be in possession of it entitlted to possession with the owner's consent unless the of the vehicle. contrary is proved. 211. The registration of a vehicle in the Leave to appeal this name of a person is for the purposes of decision to the Supreme the Act and the regulations Court of Canada was presumptive evidence that that person refused: 2002 Carswell is the owner of the vehicle. Nfld 288.

Page 20 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

1. NOVA SCOTIA Motor Vehicle Act, "Owner" means a person who holds Neither a vendor under a conditional Caselaw: ACCIDENTS PRE APRIL R.S.N.S. 1989, c. 293, the legal title of a vehicle and includes sale contract nor a lessor under a Mader v. Lahey, [1997] 1, 2013 ss. 62 and 248 a transferee or in the event a vehicle is lease with an option to purchase N.S.J. No. 571 (S.C.); the subject of an agreement for the would be held liable for the affirmed by Nova Scotia conditional sale or lease thereof with negligence of the driver, as long as court of appeal (1998) the right of purchase upon performance the buyer/lessee has an immediate 169 N.S.R. (2d) 182 of the conditions stated in the right of possession to the vehicle agreement and with an immediate right (the Act provides the lessee/buyer in Gilbert v. Giffin and of possession vested in the conditional those cases would be considered Chrysler Financial 2010 vendee or lessee, or in the event a the "owner"). NSCA 95. mortgagor of a vehicle is entitled to possession, then the conditional However, a lessor under a lease vendee or lessee or mortgagor shall be with no option to purchase would deemed the owner for the purpose of likely be held liable as an "owner" this Act. and would be vicariously liable for the negligence of the driver. 62(1) The owner of a motor vehicle engaged in the business of renting motor vehicles without drivers, who rents a vehicle without a driver to another, otherwise than as part of a bona fide transaction involving the sale of the motor vehicle, permitting the renter to operate the vehicle upon the highways, shall be jointly and severally liable with the renter for any damages caused by the negligence of the latter in operating the vehicle and for any damages caused by the negligence of any person permitted to operate the vehicle by the person renting the same and with the express or implied permission of the owner.

62(4) Any provision in any rental contract, whereby the owner of any motor vehicle so rented is relieved from liability in respect of any matters mentioned in subsection (1), shall be void. 248(3) A person operating a motor vehicle, other than the owner thereof, shall be deemed to be the servant and

Page 21 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

agent of the owner of the motor vehicle 1. NOVA SCOTIA and to be operating the motor vehicle ACCIDENTS PRE as such servant and agent acting in the APRIL 1, 2013 course of his employment and within (CONTINUED) the scope of his authority as such servant and agent unless and until the contrary is established.

2. NOVA SCOTIA Insurance Act, 148D (1) In this Section, The vicarious liability provisions limit The definition of ‘owner’ ACCIDENTS ON OR AFTER R.S.N.S. 1989, c. 231, as liability of motor vehicle leasing and under the Motor Vehicle APRIL 1, 2013 amended, ss. 191.9 and (a) “conditional seller” means a rental businesses for damages to a Act, as well as sections 192 person who, by agreement, in the maximum of $1 million. The 62 and 248, (all three of ordinary course of the person’s provisions also retain the existing which are referenced business, enters into an agreement exemption from vicarious liability for above regarding the with another person for the conditional sale vendors and codify statutory regime in Nova conditional sale or lease of a the existing case law exempting Scotia prior to April 1, vehicle with the right of purchase on lessors and renters with an option to 2013), were repealed performance of the conditions set purchase lease from any vicarious pursuant to the Fair out in the agreement and with an liability. Automobile Insurance immediate right of possession (2011) Act (Bill 86). vested in the conditional vendee or Lessors and renters under contracts lessee; without an option to purchase will As a result, the new still be exposed to liability; however, regime is governed by (b) “lender” means a person who this exposure will be significantly the sections of the holds a security interest in a motor limited. The starting point for Insurance Act and the vehicle through a written security lessors and renters is s. 148D (4), Non-Owned Automobile agreement, who under that which holds that a lessor or renter’s Insurance Liability agreement has lent money to a maximum liability under s. 148D (7) Regulations set out person in respect of the motor is net of all other amounts recovered herein. vehicle and who is not in in respect of the same incident – this possession of the motor vehicle, or maximum liability is to be $1 million Pursuant to the Fair a person to whom the lender has dollars (or greater if required by law Automobile Insurance assigned the agreement; or prescribed by regulation). (2011) Act (Bill 86), the (c) “lessor” means a person who, new definition of ‘owner’ by agreement, in the ordinary The amounts to be subtracted from under the Motor Vehicle course of the person’s business, the maximum lessor/renter liability in Act is as follows: leases or grants exclusive use of a s.148D(4) are broadly defined and it motor vehicle to another person for is clearly stated that the insurer of a 2A (1) Subject to a term of more than thirty days or lessor/renter will not be required to subsections (2) and (3), otherwise grants exclusive use of a make any payments to a claimant in this Act, “owner” of a motor vehicle to another person for beyond a top-up to the vehicle means a period of more than thirty days, lessor/renter’s prescribed maximum and who is not in possession of the (a) where a permit is

Page 22 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

2. NOVA SCOTIA motor vehicle, or a person to whom liability of $1 million. issued for the ACCIDENTS ON OR AFTER the lessor has assigned the vehicle, the person APRIL 1, 2013 agreement, but does not include a who holds the permit (CONTINUED) conditional seller; for the vehicle; or (b) where no permit (d) “renter” means a person who, is issued for the by agreement, in the ordinary vehicle, the person course of the person’s business, who holds the rents a motor vehicle to another certificate of person for a term of no more than registration for the thirty days and who is not in vehicle. possession of the motor vehicle, or a person to whom the renter has assigned the agreement;

…

(g) “seller” means a person who holds a security interest in a motor vehicle through a written security agreement, who sells the motor vehicle to another person under a contract in writing when the purchaser has carried out the terms of the contract and who is not in possession of the motor vehicle, or a person to whom the seller has assigned the security agreement or the contract.

…

(4) Notwithstanding any other provision in this Part, except subsections (8) and (12), in an action for the recovery of loss or damage sustained by a person by reason of a motor vehicle on a highway, the maximum amount for which a lessor or renter of the motor vehicle is liable in respect of the same incident in the person’s capacity as a lessor or renter of the motor vehicle is the amount determined under

Page 23 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

2. NOVA SCOTIA subsection (7) less any amounts that ACCIDENTS ON OR AFTER APRIL 1, 2013 (a) are recovered for loss or (CONTINUED) damage under the third party liability provisions of a contract evidenced by a motor vehicle liability policy issued to a person other than a lessor or renter;

(b) are in respect of the use or operation of the motor vehicle; and

(c) are in respect of the same incident.

…

(7) The maximum amount for which a lessor or renter of a motor vehicle is liable for the purpose of subsection (4) is the greatest of

(a) one million dollars;

(b) the amount of third party liability insurance required by law to be carried in respect of the motor vehicle; and

(c) the amount established, or determined in the manner prescribed, by regulation.

NOVA SCOTIA Non-Owned Automobile Priority of payment for insurance The Non-Owned Automobile Note: Although at ACCIDENTS ON OR AFTER Insurance Liability held by lessor or renter Insurance Liability Regulations present only public APRIL 1, 2013 Regulations, establish the priority of payment of passenger vehicles are N.S. Reg. 186/2013 4 (1) The order in which the third party automobile insurance policies in excluded from the cap, liability provisions of any motor vehicle claims involving rented and leased pursuant to Section liability policies apply in respect of the vehicles. Pursuant to s. 4 (2) of the 148D (8)(b), (9)(b) and following liability must be determined in Regulations, the insurance of the (10) the Governor in accordance with this Section and lessor/renter is first loss insurance Council may make Section 5: unless insurance is available under different regulations for a contract described in s. 4 (3). If an different classes of (a) liability that arises from or insurer under a contract described in conditional sellers, occurs in connection with the s. 4 (3) fails to respond to a claim on lenders, lessors, renters ownership of a leased or rented

Page 24 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

NOVA SCOTIA Non-Owned Automobile automobile; or behalf of a lessee/rentee (i.e. the and sellers as well as ACCIDENTS ON OR AFTER Insurance Liability driver), that insurer is liable to for different classes of APRIL 1, 2013 Regulations, (b) liability that, directly or indirectly, indemnify the insurer of the vehicles, including (CONTINUED) N.S. Reg. 186/2013 arises from or occurs in connection lessor/renter for any liability, costs regulations that deem (continued) with the use or operation of a and expenses incurred as a result of the vicarious liability leased or rented automobile. such failure (s. 4 (6)(b)). Section 4 provisions inapplicable (4) sets out the priority of payment to any of these classes. (2) Except as provided in subsection among the insurers listed in s. 4 (3) (3), insurance available under a and the Regulations place the contract evidenced by an owner’s insurance issued to the lessor/renter policy issued to a lessor or renter is first last in line: loss insurance.

(3) Subsection (2) does not apply if 1. insurance under which the there is insurance available under any driver of the leased or of the following contracts: rented automobile is entitled to indemnity as a (a) a contract evidenced by a motor person who is a partner, vehicle liability policy under which officer or employee of an the lessee or rentee of the insured named in an automobile is entitled to indemnity approved standard policy as an insured named in the form (NSPF 6) for non- contract; or owned automobiles that is part of the contract; (b) a contract evidenced by a motor 2. insurance under which the vehicle liability policy under which lessee or rentee of the the driver of the leased or rented automobile is entitled to automobile is entitled to indemnity indemnity as an insured as any of the following: named in the contract; 3. insurance under which the an person who is a partner, (i) driver of the leased or officer or employee of an insured rented automobile is named in an approved standard entitled to indemnity as an policy form (NSPF 6) for non- insured named in the owned automobiles that is part of contract; the contract, 4. insurance under which the (ii) an insured named in the driver of the leased or contract, rented automobile is entitled to indemnity as the (iii) the spouse or adult spouse or adult interdependent partner of an interdependent partner of insured named in the contract an insured named in the who resides with that insured, contract who resides with that insured;

Page 25 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

NOVA SCOTIA Non-Owned Automobile (iv) an unnamed insured. 5. insurance under which the ACCIDENTS ON OR AFTER Insurance Liability driver of the leased or APRIL 1, 2013 Regulations, (4) Subject to subsection (5), if rented automobile is (CONTINUED) N.S. Reg. 186/2013 subsection (3) applies, then the priority entitled to indemnity as an (continued) of pay among insurers is as follows: unnamed insured; and 6. insurance issued to the (a) insurance described in renter/lessor. subclause (3)(b)(i) is first loss

insurance;

(b) insurance described in clause (3)(a) is excess insurance to the insurance identified as first loss insurance in clause (a);

(c) insurance described in subclause (3)(b)(ii) is excess insurance to insurance identified as excess in clause (b);

(d) insurance described in subclause (3)(b)(iii) is excess insurance to insurance identified as excess in clause (c);

(e) insurance described in subclause (3)(b)(iv) is excess insurance to insurance identified as excess in clause (d);

(f) insurance described in subsection (2) is excess insurance to insurance described in subsection (3).

…

(6) If an insurer under a contract Pursuant to s. 4 (6), when an insurer described in subsection (3) fails to responds to a claim or civil action respond to a claim or civil action on and that insurer’s insurance is behalf of a lessee, rentee or driver, excess to insurance available under the contract of an insurer who fails (a) an insurer under a contract to respond, the insurer who fails to described in subsection (2) must respond is liable to indemnify the respond to the claim; and insurer who did respond.

Page 26 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

NOVA SCOTIA Non-Owned Automobile (b) the insurer under a contract ACCIDENTS ON OR AFTER Insurance Liability described in subsection (3) who APRIL 1, 2013 Regulations, failed to respond is liable to (CONTINUED) N.S. Reg. 186/2013 indemnify all of the following for any (continued) liability, costs and expenses incurred as a result of the failure:

(i) any insurer who responds to the claim or civil action under clause (a),

any insurer who responds to (ii) the claim or civil action under a

contract described in subsection

(3), if the insurance described in

the contract of the insurer who

responds is excess insurance in

accordance with subsection (4) to

the insurance available under the

contract of the insurer who fails to

respond.

…

Public passenger vehicle exemption Pursuant to s. 8, the cap does not 8 Subsection 148D(4) of the Act does apply to vehicles engaged in the not apply in respect of a motor vehicle public carrier of passengers, or that is a public passenger vehicle as passengers and freight, for gain defined in the Motor Carrier Act. (such as taxis and busses).

Page 27 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

1. ONTARIO Highway Traffic Act, 192. (1) The owner of a motor vehicle Both lessor and conditional sale "Owner" is not defined ACCIDENTS PRE-MARCH R.S.O. 1990, c. H.8, ss. or street car is liable for loss or damage vendor are vicariously liable for the in the legislation. The 1, 2006 192(1) and (2) sustained by any person by reason of negligence of the driver. cases appear to take a negligence in the operation of the broad view of "owner" motor vehicle or street car on a and it likely highway unless the motor vehicle or encompasses both a street car was without the owner's conditional sale vendor consent in the possession of some and lessor. person other than the owner or the Edler v. Boyles owner's chauffeur, and the driver of a Transport Ltd. motor vehicle or street car not being (1974), 6 O.R. (2d) 72 the owner is liable to the same extent Hayduk v. Pidoborozny, as the owner. [1972] S.C.R. 879 (on appeal (2) Where a motor vehicle is leased, from Alberta court of the consent of the lessee of the motor appeal) vehicle to the operation or possession thereof by some person other than the lessee shall, for the purposes of subsection (1), be deemed to be the consent of the owner of the motor vehicle. 2. ONTARIO Highway Traffic Act, Highway Traffic Act Under the Highway Traffic Act, Although s. 192 of the ACCIDENTS ON OR R.S.O. 1990, c. H-8, as 191.9 In this Part, each of the driver, owner and lessee Highway Traffic Act AFTER MARCH 1, 2006 amended, ss. 191.9 and “lessee” means a person who leases or is jointly and severally liable for the has been revised, the 192 rents a motor vehicle or street car for negligence of the driver. effect of the section any period of time. does not appear to have AND 192. (1) The driver of a motor vehicle changed, and the above or street car is liable for loss or damage comment continues to Insurance Act, R.S.O. sustained by any person by reason of apply. 1990, c. I.8, as amended negligence in the operation of the (see below) motor vehicle or street car on a highway.

(2) The owner of a motor vehicle or street car is liable for loss or damage sustained by any person by reason of negligence in the operation of the motor vehicle or street car on a highway, unless the motor vehicle or street car was without the owner’s consent in the possession of some person other than the owner or the

Page 28 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

2. ONTARIO Highway Traffic Act, owner’s chauffeur. ACCIDENTS ON OR R.S.O. 1990, c. H-8, as AFTER MARCH 1, 2006 amended, ss. 191.9 and (CONTINUED) 192 (3) A lessee of a motor vehicle or street car is liable for loss or damage sustained by any person by reason of negligence in the operation of the motor vehicle or street car on a highway, unless the motor vehicle or street car was without the lessee’s consent in the possession of some person other than the lessee or the lessee’s chauffeur.

(4) Where a motor vehicle is leased, the consent of the lessee to the operation or possession of the motor vehicle by some person other than the lessee shall, for the purposes of subsection (2), be deemed to be the consent of the owner of the motor vehicle.

(5) The driver, owner, lessee and operator that are liable under this section are jointly and severally liable.

ONTARIO Insurance Act, R.S.O. Insurance Act Under the Insurance Act the liability To date there has been ACCIDENTS ON OR 1990, c. I.8, as amended 267.3 In sections 267.4 to 267.12, of a lessor of a motor vehicle no judicial consideration AFTER MARCH 1, 2006 “owner” includes an operator as (subject to exceptions noted below), of the amendments to defined in subsection 16(1) of the when the vehicle is in the lessee’s the Insurance Act. Highway Traffic Act and a person who control at the time of an accident, is is a lessee for the purposes of section “capped” – currently at $1.0 million. The liability of a 192 of that Act; conditional sale vendor 267.12 (1) Despite any other provision This is as a result of the operation of remains unaffected by in this Part, except subsections (4) and ss. 267.12(1) and 267.12(3), the the recent amendments (5), in an action in Ontario for loss or latter of which provides that the to the Insurance Act, damage from bodily injury or death “cap” is the “greatest of” (a) $1.0 and is not limited. arising directly or indirectly from the million; (b) the third party liability use or operation of a motor vehicle that insurance required by law to be Sienna Foods v. Old is leased, the maximum amount for carried – currently $200,000 (s. Republic Insurance which the lessor or lessors of the motor 251(1)); and (c) the amount set by Company of Canada vehicle are liable in respect of the same regulation – currently there is no 2012 ONCA 583 the

Page 29 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

ONTARIO incident in their capacity as lessors of regulation in place. insurer of the truck ACCIDENTS ON OR the motor vehicle is the amount rental company which AFTER MARCH 1, 2006 determined under subsection (3) less NOTE: The “cap” only applies where owned the truck, was (CONTINUED) any amounts, the lessor’s liability arises as a result liable for the cargo of of the vicarious liability imposed the truck renting (a) that are recovered for loss or under s. 192 of the Highway Traffic customer damaged in damage from bodily injury or death Act (s. 267.12(4)). the traffic accident under the third party liability provisions of contracts evidenced by motor vehicle NOTE: The “cap” does NOT apply liability policies issued to persons other with respect to motor vehicles used than a lessor; as a taxicab, livery vehicle or Xu v. Mitsui Sumitomo limousine for hire, or with respect to Ins. Co. Ltd. 2014 (b) that are in respect of the use or such other vehicles as may be ONSC 167, upheld by operation of the motor vehicle; and (c) prescribed by regulations (currently the Court of Appeal at that are in respect of the same there are no such regulations in 2014 ONCA 805. incident. place). The O.E.F. 110 (3) The maximum amount for the The above provisions do not in any endorsement, approved purposes of subsection (1) is the way affect the liability of a January 1, 2008, greatest of, conditional sale vendor. provides that the lessor’s policy restricts (a) $1,000,000; coverage of the lessee (b) the amount of third party liability to $1.0 million. There insurance required by law to be carried was therefore a in respect of the motor vehicle; and legislative “gap” from (c) the amount determined in the March 1, 2006 to manner prescribed by the regulations, if January 1, 2008. regulations are made prescribing the manner for determining an amount for Issue: is coverage the purposes of this clause. available to the lessee (4) Subsection (1) does not apply, under the lessor’s policy during the legislative (a) in such circumstances as may be “gap” for the full value of prescribed by the regulations or to such the policy? persons, classes of persons, motor vehicles or classes of motor vehicles as The Court held that may be prescribed in the regulations, under s.267.12(1) the subject to such terms, conditions, liability of lessors, provisions, exclusions and limits as subject to the prescribed may be prescribed by the regulations; exceptions, is $1.0 million. Section (b) in respect of amounts payable by 267.12(1) precludes a a lessor other than by reason of the lessee from securing

Page 30 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

ONTARIO vicarious liability imposed under section coverage under a ACCIDENTS ON OR 192 of the Highway Traffic Act; or lessor’s policy beyond AFTER MARCH 1, 2006 the $1.0 million cap. (CONTINUED) (c) in respect of a motor vehicle used as a taxicab, livery vehicle or limousine Where an excess or for hire. umbrella insurance policy qualifies as an (6) In this section, owner’s policy under the “lessor” means, in respect of a Insurance Act, the policy motor vehicle, a person who is leasing will cover the or renting the motor vehicle to another lessee/driver as if he or person for any period of time, and she was a party to the “Insurance Act s.267.12(1) referenced insurance contract. In above, enacted March 1, 2006. Xu the excess policy “leased” has a corresponding meaning. was not issued to the lessor, but to a related company. It was therefore not an owner’s policy and did not extend coverage to the driver (lessee). If the excess policy was issued to the lessor and qualified as an owner’s policy, coverage would have been available to the driver (lessee). However, the court would still have concluded that the policy was not required to respond on behalf of the lessee during the legislative “gap”, as the liability of the lessor is still capped at $1.0 million.

This issue of the “legislative gap” is unlikely to arise again, as it ended December 31, 2007.

Page 31 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

PRINCE EDWARD ISLAND Highway Traffic Act, 1 (m.1) "owner" includes: An owner is effectively deemed to The definition of "owner" ACCIDENTS BEFORE R.S.P.E.I. 1988, c. H-5 (i) the person who holds the legal title be vicariously liable for a driver who is identical to that in the FEBRUARY 1, 2014 before amendment by to a vehicle, is driving with the expressed or Newfoundland An Act to Amend the (ii) in the case of a vehicle that is implied consent of the owner. legislation, except that Highway Traffic Act, registered, the person in whose name it the PEI definition uses S.P.E.I. 2013, c. 14 is registered, The definition of "owner" is inclusive, “includes” rather than (see below) (iii) in the case of a vehicle that is the rather than exhaustive, leaving it “means”, permitting subject of a mortgage, the mortgagor if subject to argument in each case as argument as to whether he is entitled to possession of the to whether a vendor under a situations not vehicle, conditional sale contract or a lessor specifically listed in the (iv) in the case of a vehicle that is the under a lease with or without an PEI definition might also subject of a hire-purchase agreement, option to purchase would be be considered to fall the person in possession of the vehicle considered to be an “owner”. within the definition of under the agreement, or an “owner” and (v) in the case of a vehicle that is the Despite agreement between the permitting a finding that subject of a conditional sale contract, lessor (GMAC) and lessee (a local there are multiple the buyer under the conditional sale dealer operating as “Choice-Rent-A- owners. contract, if he is entitled to possession Car”) that the lessee was the owner, The Nfld. Court of of the vehicle; Gallant v. Piccott, 2000 PESCAD Appeal decision in Kerri 17, held that issues of ownership, v. Decker underlines the 286. When loss or damage is consent and liability under the HTA importance of the sustained by any person by reason of a could not be decided on a motion for distinction between the motor vehicle upon a highway the onus summary judgment by the lessor use of “means” and of proof that the loss or damage did not (GMAC), but instead ought to be left “includes”, thus it is not arise through the negligence or for determination at trial. In its clear the result would be improper conduct of the owner or driver decision, the appeal division notes the same in PEI, though is upon the owner or driver. that if the evidence of ownership the reasoning would presented on the motion were otherwise be 287. In an action for the recovery of accepted at trial, “it would appear persuasive. loss or damage sustained by a person they are both owners as far as the by reason of a motor vehicle upon a Highway Traffic Act is concerned highway, every person driving the and ss. 286 and 287 would come motor vehicle who is living with and as into play” (see para. 24). A a member of the family of the owner subsequent decision between the thereof and every person driving the parties (2001 PESCTD 52) finds the motor vehicle with the consent, lessor GMAC jointly and severally expressed or implied, of the owner liable, indicating that both the lessor thereof shall be deemed to be the and the lessee were owners. agent or servant of the owner of the motor vehicle and to be employed as such and shall be deemed to be driving the motor vehicle in the course of his employment, but nothing in this

Page 32 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

PRINCE EDWARD ISLAND subsection relieves any person ACCIDENTS BEFORE deemed to be the agent or servant of FEBRUARY 1, 2014 the owner and to be driving the motor (CONTINUED) vehicle in the course of his employment from the liability for such damages.

PRINCE EDWARD ISLAND Highway Traffic Act, 1 (m.1) "owner" includes: An owner who (a) is a conditional The amendments ACCIDENTS ON OR AFTER R.S.P.E.I. 1988, c. H-5 (i) the person who holds the legal title seller (sale or lease with a right to effective February 1, FEBRUARY 1, 2014 as amended by An Act to to a vehicle, purchase), lender or seller and (b) 2014 exempting Amend the Highway (ii) in the case of a vehicle that is was not in possession of the motor conditional sellers, Traffic Act, S.P.E.I. 2013, registered, the person in whose name it vehicle when the loss or damage lenders and sellers, c. 14 is registered, was sustained, is exempted from have not yet been (iii) in the case of a vehicle that is the deemed vicarious liability for the judicially considered. subject of a mortgage, the mortgagor if driver. he is entitled to possession of the There has been no vehicle, An owner is otherwise effectively change for lessors (iv) in the case of a vehicle that is the deemed to be vicariously liable for a under a lease with no subject of a hire-purchase agreement, driver who is driving with the option to purchase (see the person in possession of the vehicle expressed or implied consent of the above for the situation under the agreement, or owner (under s. 287(1)). prior to the (v) in the case of a vehicle that is the amendments). subject of a conditional sale contract, For lessors under a lease with no the buyer under the conditional sale option to purchase, vicarious liability contract, if he is entitled to possession remains as it was prior to the of the vehicle; amendments, that is, subject to argument in each case (see above 286.(1) Subject to subsection (2), when for the situation prior to the loss or damage is sustained by any amendments effective February 1, person by reason of a motor vehicle 2014). upon a highway the onus of proof that the loss or damage did not arise through the negligence or improper conduct of the owner or driver is upon the owner or driver.

(2) Subsection (1) does not apply to an

owner who, in relation to the motor

vehicle referred to in that subsection,

(a) is a conditional seller, lender, or seller; and

(b) was not in possession of the motor

Page 33 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

PRINCE EDWARD ISLAND vehicle when the loss or damage was ACCIDENTS ON OR AFTER sustained. FEBRUARY 1, 2014 (3) For the purposes of subsections (2) (CONTINUED) and 287(2),

(a) “conditional seller” means a person who, in the ordinary course of the person’s business, enters into an agreement with another person for the conditional sale or lease of a motor vehicle with a right of purchase on the performance of the conditions set out in the agreement and an immediate right of possession in the conditional buyer or lessee, and includes a person to whom the conditional seller has assigned the agreement;

(b) “lender” means a person who holds a security interest in a motor vehicle through a written security agreement and under that agreement has lent money to a person in respect of the motor vehicle, and includes a person to whom the lender has assigned the agreement;

(c) “security agreement” and “security interest” mean a security agreement and a security interest as defined in the Personal Property Security Act R.S.P.E.I. 1988, Cap. P-3.1, or the equivalent terms under personal property security legislation of another province.

(d) “seller” means a person who holds a security interest in a motor vehicle through a written security agreement and who sells the motor vehicle to another person under a written contract, and includes a person to

Page 34 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

PRINCE EDWARD ISLAND whom the seller has assigned the ACCIDENTS ON OR AFTER contract. R.S.P.E.I. 1974, Cap. H-6, FEBRUARY 1, 2014 s.271; 2013, c.14, s.6. (CONTINUED) 287. (1) Subject to subsection (2), in an action for the recovery of loss or damage sustained by a person by reason of a motor vehicle upon a highway, every person driving the motor vehicle who is living with and as a member of the family of the owner thereof and every person driving the motor vehicle with the consent, expressed or implied, of the owner thereof shall be deemed to be the agent or servant of the owner of the motor vehicle and to be employed as such and shall be deemed to be driving the motor vehicle in the course of his employment, but nothing in this subsection relieves any person deemed to be the agent or servant of the owner and to be driving the motor vehicle in the course of his employment from the liability for such damages.

(2) Subsection (1) does not apply where the owner, in relation to the motor vehicle referred to in that subsection,

(a) is a conditional seller, lender, or seller; and

(b) was not in possession of the motor vehicle when the loss or damage was sustained. R.S.P.E.I. 1974, Cap. H-6, s.272; 2013, c.14, s.7.

Page 35 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

QUÉBEC Automobile Insurance "Owner": means a person who An "owner" is not liable for bodily There has been very Act, R.S.Q., c. A-25 acquires or possesses an automobile injury caused by an automobile by little case law under a title of ownership, under a title virtue of the no-fault system, but an interpreting a lessor's involving a condition or a term giving "owner" is liable for property liability. him the right to become the owner damage. thereof, or under a title giving him the right to use it as the owner thereof A vendor under a conditional sale charged to deliver over, and a person contract would NOT be an "owner" who leases an automobile for a period under the Act. of not less than one year. A lessor will be jointly and severally 108. The owner of an automobile is liable with the "owner" (the lessee) liable for the property damage caused as a result of s. 110 of the Act. The by such automobile. liability will only be with respect to property damage. 110. When an automobile is registered in the name of a person other than the owner, such person is jointly and severally liable with the owner, unless he proves that the registration was effected by fraud and without his knowledge.

Page 36 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

SASKATCHEWAN Highway Traffic Act, SS Liability of operator and owner From 1986 to June 30 2004, this 1986, c H-3.1 (past 86(1) If loss, damage or injury is statute specifically allowed for version in force between caused to a person by a motor vehicle, vicarious liability of owners. This (HISTORICAL) Jun 27, 2003 and Jun 29, the person driving it at the time is liable section was repealed in June 2004. 2004) (Repealed by for the loss, damage or injury if it was TSA)) caused by that person's negligence or improper conduct. […]

(CURRENT) The Traffic Safety Act, 2.(1)(x) “owner” includes: Under the TSA there is no statutory S.S. 2004, c. T-18.1 (i) a lessee of a motor vehicle; or provision on vicarious liability that (ii) a person who is in possession of a would make an owner liable for the motor vehicle under a contract by driver/operator. which that person may become the owner of the motor vehicle on full As a general rule owners, including compliance with the terms of the vendors or lessors, will not be contract; subject to any vicarious liability for personal injury damages. (see AAIA Onus of proof in accident below). 256(1) If loss, damage or injury is sustained by a person by reason of a Under the TSA the key is the motor vehicle on a highway, the onus registered owner as opposed to the of proof that the loss or damage did not title owner. entirely or solely arise through the negligence or improper conduct of the owner or driver of the motor vehicle is on the owner or driver.

(2) This section does not apply to a collision between motor vehicles on a highway.

Page 37 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

SASKATCHEWAN Automobile Accident Part VIII – No fault By default, Saskatchewan residents NOTE: in 2012, the (CONTINUED) Insurance Act, R.S.S. are subject to no-fault insurance Saskatchewan Court of 1978, c. A-35 No Fault coverage under Part VIII of the Appeal held in John Automobile Accident Insurance Act. Acton v. Rural 101 (1.1) This Part applies to any Municipality of Britannia person who sustained bodily injury However, SK residents can opt out No. 502 and Ron caused by a motor vehicle arising out of the no-fault regime by electing tort Handel Farm Ltd., 2012 of an accident on or after the date that liability under Part IV of the SKCA 127, that the this Part comes into force and who has Automobile Accident Insurance Act plaintiff could both not provided the insurer with a tort (less than 1%) collect no fault benefits election in the manner prescribed by and sue in tort for his Part IV. In both cases, owners would non-reimbursed 101 (1.2) A person who is entitled to generally not be held vicariously economic losses arising benefits pursuant to this Part is not liable for bodily injury and damage to from his catastrophic entitled to benefits pursuant to Part II property caused by a motor vehicle injuries in a single other than a death benefit pursuant to accident. vehicle accident. Part II relating to the death of an insured. Circumstances creating a special Leave to appeal to the relationship would be required to Supreme Court of 108(1) An insured who is resident in create common law vicarious liability Canada has been Saskatchewan at the date of the against an owner. denied. accident, and the insured’s surviving spouse or dependant, are entitled to SK residents under tort coverage benefits if the accident occurs in are allowed to claim for damages for Canada or the United States of economic loss for living assistance, America or on a vessel travelling rehabilitation and net loss of income between ports of those countries. above the annual statutory threshold, outside of the statutory (2) An injured person who is not a no-fault benefits, against any third resident of Saskatchewan and who is party. injured in Saskatchewan in a motor vehicle registered in Saskatchewan is For non-residents injured in SK they deemed to be a resident of would likely be deemed residents Saskatchewan, unless there is an and subject to no-fault coverage, but agreement between the insurer and a that depends on where the injured government or agency of the party is from. If injured in SK in a government of the jurisdiction where vehicle registered in SK a non- the injured person resides that provides resident would be deemed a otherwise. resident, unless there is a reciprocal agreement with the jurisdiction Benefits for non-residents where they reside. 109(1) Subject to this Part, a person injured in an accident that occurs in

Page 38 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

SASKATCHEWAN Saskatchewan who is not resident in (CONTINUED) Saskatchewan, and any surviving spouse or dependant of that person, is entitled to benefits:

(a) in accordance with any agreement between the insurer and a government or an agency of the government of the place of residence of the person injured; or

(b) if no agreement exists, to the extent

that the insurer determines that the

person injured is not responsible for the

accident.

Part IV – Tort Liability

Actions for bodily injury prohibited

40.1 Notwithstanding any other Act or law but subject to this Part and Part VIII:

(a) no person has any right of action respecting, arising out of or stemming from bodily injuries caused by a motor vehicle arising out of an accident that occurs on or after the day this Part comes into force; and

(b) no action or proceeding lies or may be commenced in any court respecting, arising out of or stemming from bodily injuries caused by a motor vehicle arising out of an accident that occurs on or after the day this Part comes into force.40.2 (1) A

Tort Election Saskatchewan resident may provide the insurer with a tort election that sets out that resident’s intention to:

Page 39 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

(a) elect to obtain coverage pursuant to SASKATCHEWAN Part II; (Bodily Injury Benefits); (CONTINUED) (b) waive the resident’s right to obtain benefits pursuant to Part VIII; (No Fault Bodily Injury Benefits) and

(c) elect to bring an action for loss or

damage for bodily injury caused by a

motor vehicle arising out of an

accident.

41(1) Subject to subsection (2), no action may be brought for bodily injury to any person respecting, arising out of or stemming from bodily injury or damage to property caused by a motor vehicle arising out of an accident against a Saskatchewan resident who:

(a) is a Part VIII beneficiary; and

(b) is the owner, operator or passenger of the motor vehicle involved in the accident.

(2) Notwithstanding subsection (1), an action may be brought against a Part VIII beneficiary mentioned in subsection (1) for: (a) property damage in excess of any insurance money paid or to be paid to the person claiming against the Part VIII beneficiary pursuant to section 51.1;

(b) economic loss caused by that Part VIII beneficiary in excess of any benefits or insurance money paid or to be paid to the person claiming against that Part VIII beneficiary pursuant to Part II or section 51.1; and

(c) non-economic loss caused by that

Page 40 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

Part VIII beneficiary in excess of any insurance money paid or to be paid to SASKATCHEWAN the person claiming against that Part (CONTINUED) VIII beneficiary pursuant to section 51.1, but only if:

(i) the loss is caused by a Part VIII beneficiary operating a motor vehicle who is convicted of an offence pursuant to paragraph 253(a)

or (b), subsection 254(5) or subsection

255(2) or (3) of the Criminal Code;

or

(ii) the loss is caused by a Part VIII beneficiary operating a motor vehicle who intentionally caused or attempted to cause bodily injury to another person and, as a result of the operation of the motor vehicle, the operator is convicted of an offence pursuant to section 235, 236, 239, 249, 266, 267, 268 or 269 of the Criminal Code.

RELATING TO BUSES The Motor Carrier 2 (b.1) “commercial vehicle” means any No judicial treatment of SPECIFICALLY Conditions of Carriage of the following vehicles: this Regulation. Regulations, M-21.2 Reg 5 (formerly under The (ii) a vehicle registered in Class PB or PB refers to a vehicle Motor Carrier Act which PS with a seating capacity, according registered as a public was repealed by The to the manufacturer of that vehicle, of service vehicle (intercity Traffic Safety Act (T- more than 10 persons including the passenger bus) 18.1). These Regulations driver; according to the The continue in force under Automobile Accident Property damage insurance The Traffic Safety Act) Insurance (General) 7(1) In this section, “motor vehicle Regulations, 2002 liability policy” means a policy of insurance that insures the operator of the vehicle, and every other person who with his or her consent operates Any person who operates a the vehicle, against liability imposed by passenger bus in SK is obligated to law arising out of the ownership, use or file a motor vehicle liability policy to operation of a vehicle resulting from insure against:

Page 41 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

SASKATCHEWAN loss of or damage to any property, (BUSES - CONTINUED) whether real or personal, of any person 7(2)(d) liability imposed by law whether that person is a passenger in arising out of the ownership, use or the vehicle or not. operation of a vehicle resulting from loss of or damage to any property (1.1) Subject to the amounts mentioned (at least 3 million if carries more in subsection (2), the following persons then 16 passengers) shall file with the board a motor vehicle liability policy: 8(2)(d) liability imposed by law arising out of the ownership, use or (a) any person who operates a operation of a vehicle resulting from commercial vehicle and is not exempt bodily injury to or the death of any from the requirement of obtaining a person (at least 3 million if carries safety certificate; more then 16 passengers) (b) any person who operates a Class PB vehicle.

(2) Every policy required pursuant to subsection (1.1) to transport:

(a) general merchandise except the commodities set out in Schedule XII of the Transportation of Dangerous Goods Regulations (Canada), being SOR 85-77 of January 18, 1985, as amended from time to time, made pursuant to the Transportation of Dangerous Goods Act (Canada), as amended from time to time, shall insure to the limit of at least $1,000,000;

(b) the commodities mentioned in clause (a) shall insure to the limit of at least $2,000,000; (c) passengers, and the passenger seating capacity of the vehicle used for transporting passengers is 15 or less, shall insure to the limit of at least $1,000,000; or

(d) passengers, and the passenger SASKATCHEWAN seating capacity of the vehicle used for

Page 42 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

(BUSES - CONTINUED) transporting passengers is 16 or more, shall insure to the limit of at least $3,000,000; exclusive of interest and costs.

(3) Where the board accepts a bond in place of a motor vehicle liability insurance policy, the bond shall be in the same amount that is required in the case of an insurance policy.

Bodily injury insurance

8(1) In this section, “motor vehicle liability policy” means a policy of insurance that insures the operator of the vehicle, and every other person who with his or her consent operates the vehicle, against liability imposed by law arising out of the ownership, use or operation of a vehicle resulting from bodily injury to or the death of any person, whether that person is a passenger in the vehicle or not.

(1.1) Subject to the amounts mentioned in subsection (2), the following persons shall file with the board a motor vehicle liability policy:

(a) any person who operates a commercial vehicle and is not exempt from the requirement of obtaining a safety certificate;

(b) any person who operates a Class PB vehicle. (2) Every policy required pursuant to subsection (1.1) from a person who is authorized by an operating authority certificate to transport:

(a) general merchandise except the SASKATCHEWAN commodities set out in Schedule XII of

Page 43 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

(BUSES - CONTINUED) the Transportation of Dangerous Goods Regulations (Canada), being SOR 85-77 of January 18, 1985, as amended from time to time, made pursuant to the Transportation of Dangerous Goods Act (Canada), as amended from time to time, shall insure to the limit of at least $1,000,000; (b) the commodities mentioned in clause (a) shall insure to the limit of at least $2,000,000; (c) passengers, and the passenger seating capacity of the vehicle used for transporting passengers is 15 or less, shall insure to the limit of at least $1,000,000; or (d) passengers and the passenger seating capacity of the vehicle used for transporting passengers is 16 or more shall insure to the limit of at least $3,000,000; exclusive of interest and costs. (3) Where the board accepts a bond in place of a motor vehicle liability insurance policy, the bond shall be in the same amount that is required in the case of an insurance policy.

Page 44 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

SASKATCHEWAN The Vehicle Classification 2.(1)(s) “passenger vehicle” means a (CONTINUED) and Registration motor vehicle with the body style of a Regulations, H-3.1 Reg 3 car, a sport utility vehicle or a bus, but (formerly under The does include a motor vehicle with the Highway Traffic Act which body style of a bus converted to a was repealed by The truck; Traffic Safety Act (T- 18.1). These Regulations 2.(1)(w) “registered owner” with continue in force under respect to a motor vehicle means the The Traffic Safety Act.) person in whose name the motor vehicle is registered pursuant to The Vehicle Administration Act;

2.(1)(4) For the purposes of section 81.4 of the Act, “commercial vehicle” means any of the following vehicles:

(c) a vehicle registered in Class PB or PS with a seating capacity, according to the manufacturer of that vehicle, of more than 10 persons, including the driver.

Class PB 9 A class of vehicles to be called "Class PB" is hereby established consisting of vehicles to be used for the transportation of passengers or passengers and express.

The Commercial Vehicle 8 Every carrier must maintain a written and Drivers (Record- record of the carrier’s existing public Keeping) Regulations, H- liability insurance coverage for all of 3.1 Reg 22 the carrier’s commercial vehicles.

The Registration 2 (c) commercial vehicle. means: Exemption and (iii) a bus Reciprocity Regulations, 1987, H-3.1 2 (g) owner., in the case of a commercial vehicle or a farm vehicle, includes a Reg 4. lessee of the vehicle who operates the

vehicle under a valid written rental agreement with the owner;

Page 45 of 46

CANADIAN VICARIOUS LIABILITY REPORT as at April 19, 2013, except updated: British Columbia (June 2015), Ontario (June 2015) and Saskatchewan (January 2014) & Prince Edward Island (February 2014)

PROVINCE DESCRIPTION RELEVANT PROVISION LIABILITY COMMENTS

SASKATCHEWAN Charter buses (CONTINUED) 9(1) Where a person: (a) is ordinarily resident in a province other than Saskatchewan; and (b) is the owner of a bus that is registered in that province; he is, while using the bus to transport passengers on a charter trip into or through Saskatchewan, exempted from the provisions of subsection 23(1) of the Act. 13254620.4

Page 46 of 46